Dynamic reconfiguration is changing the hardware configuration of a PSoC chip on-the-fly during program operation. The configuration is controlled by the contents of registers. The initial configuration is loaded at power-on. Reconfiguration is achieved during execution of the firmware. The CPU writes to the configuration registers to change the configuration on-the-fly.
Refer the application note, "AN2104 - PSoC®1 - Dynamic Reconfiguration With PSoC® Designer™" for details.